The Green and Sustainable Finance Cross-Agency Steering Group (Steering Group) welcomes the International Sustainability Standards Board’s (ISSB) publication of the International Financial Reporting Standards (IFRS) Sustainability Disclosure Standards today (27 June). These standards aim at becoming the global baseline for corporate disclosure of climate and sustainability-related information (Note 1).
The Steering Group also welcomes the reliefs built into the ISSB standards that would allow jurisdictions to scale and phase in the requirements. Relevant authorities in Hong Kong will consider alignment of the local requirements with this global baseline in a proportionate approach (Note 2).
The IFRS Foundation has stepped up its presence in Asia by opening an ISSB office in Beijing, China on 19 June 2023. The Steering Group looks forward to engaging with the ISSB in the sustainability reporting journey and collaborating on capacity building. The Steering Group will also maintain a close dialogue with market participants and stakeholders, with a view to developing and implementing world-class regulation across different financial services sub-sectors, as well as enabling Hong Kong to capitalise on climate and sustainability-related opportunities.
Ms Julia Leung, Co-Chair of the Steering Group and Chief Executive Officer of the Securities and Futures Commission (SFC) said:
“The availability of transparent, comparable and reliable sustainability information is important for financial intermediaries and global investors to meet their obligations to stakeholders on carbon emissions reduction and regulators’ requirements. As an international financial centre, Hong Kong needs to align its corporate sustainability-related disclosures with the global baseline to ensure that financial institutions are able to effectively intermediate capital and price sustainability-related risks in this part of the world.”
Mr Eddie Yue, Co-Chair of the Steering Group, Chief Executive, Hong Kong Monetary Authority (HKMA) said:
“The Steering Group welcomes the release of the ISSB's standards as a major milestone in creating a globally consistent baseline for sustainability reporting. High-quality, globally comparable sustainability disclosure is essential to effective climate risk assessment and business development. The IFRS Sustainability Disclosure Standards will facilitate more consistent disclosure, promote best market practices, and ultimately contribute to the accessibility and affordability of sustainable financing for corporates.”
Ms Teresa Ko, Vice Chair of the IFRS Foundation said:
“Heartfelt congratulations to the ISSB on its inaugural set of two standards. It is an exciting and historic moment as we see the creation of a single set of investor-focused sustainability-related disclosures that could be adopted across the world. I strongly encourage companies to use these two new standards — which have been built on and expanded from the TCFD recommendations. This is crucial for companies to provide investors with information to make more informed investment and capital allocation decisions. I also hope Hong Kong can take a leadership role in Asia in the use of these two standards now that they are published.”
Established in May 2020, the Steering Group is co-chaired by the HKMA and the SFC. Members include the Environment and Ecology Bureau, Financial Services and the Treasury Bureau, Hong Kong Exchanges and Clearing Limited, Insurance Authority and the Mandatory Provident Fund Schemes Authority. The Steering Group aims to coordinate the management of climate and environmental risks to the financial sector, accelerate the growth of green and sustainable finance in Hong Kong and support the Government’s climate strategies.